A Research On Assessment And Promotion Measures Of Financial Capacity Of Local Government In Shandong Province

Fiscal capacity is a dimension of measuring the efficiency of public finances, which is reflected in the evaluation index system on the financial capacity, for example, financial income and expenses, per capita expenditure , economic construction, the proportion of total expenditure , social security spending accounts for the proportion of financial expenditure, etc. To more easily measure the operation of public finances, or compare the operation of public finances in different regions, it is very necessary to research the financial capacity. Improving the government's fiscal capacity is a necessary condition of strengthening the administrative capacity. Therefore, with the general direction of strengthening the public finance system construction,researching fiscal problem in the new situation,exploring the ideas and policy measures to promote local economic development and enhance the financial capacity, has significant and far-reaching significance to enhance the economic strength, promote the social development and raise the overall level and improve the party's leadership of the Shandong province .Paper is divided into five parts, whose clude is promoting problems, analyzing problems and solving problems.Paper describes the connotation of financial capacity firstly, refers the theory of local fiscal capacity financial capacity ,including the theory of fiscal decentralization, public finance theory, public management theory, and makes a brief analysis of its correlation with the financial capability. From historical investigation and practical analysis of ShanDong financial situation, there is a general qualitative assessment, which stands point of view of the scale and structure of financial income and fiscal expenditure, self-sufficiency. Through the establishment of index system, using principal component analysis, with the financial capacity of explanatory variables and with relevant variables to explain the variable items, establish a quantitative evaluation model, and assess financial capacity of Shandong Province horizontally and vertically. Empirical object is financial data from 1994 tax system reform and 17 prefecture-level cities of 2009. there is an assessment result of the size of the financial capacity and the main factors affecting the financial capacity, which is a basis to point Shandong Province local government finance problems. According to the qualitative and quantitative analysis of financial ability of shandong province, aiming the actual situation, propose specific measures which can improve ability to raise revenue, expenditure and self-sufficiency and the system of financial system.In this thesis, use norms and empirical, qualitative and quantitative as well as vertical and horizontal, historical and comparative methods to study, based on the theoretical argument in full with a large number of empirical analysis. Paper uses the finance, public economics, public management theories etc. to research and explore the regional financial capacity. To a certain extent, it can expand the scope and means of theoretical research of local government. based on the data analysis and conclusion, analyze and discuss the status and problems of the financial capacity of Shandong Province, envisage policy measures to enhance the financial capacity of Shandong Province, and provide a reference for economic development and financial work.Paper's innovation lies in index system and empirical analysis. The index system to evalue financial capability is builed which contains comprehensive, actionable, objective indicators. Use the case of shandong province, calculate the financial capacity, obtain the main factors, and propose policy recommendations to increase the financial capacity of Shandong Province.